Flavin's name was not on list Fyffes sent to LSE

Fyffes did not include the name of DCC chief executive Jim Flavin in a list it sent to the London Stock Exchange, of people it believed had confidential information about the fruit distributor's trading performance in the early months of 2000, the High Court heard yesterday.

However, while agreeing that Fyffes had not included Mr Flavin's name on the list, Fyffes chief executive David McCann said Mr Flavin did have the information referred to - information which Fyffes claims was price-sensitive and prohibited Mr Flavin dealing in Fyffes shares in early February 2000.

Mr McCann said he believed that there was a "simple explanation" for the omission of Mr Flavin's name.

He believed the Fyffes response might have been interpreted as requiring the company to indicate those persons who knew in advance that Fyffes intended to issue a profit warning on March 20th 2000, and Mr Flavin did not know that.

The court heard that the London exchange conducted an inquiry into the events leading up to the March 20th, 2000 profit warning by Fyffes, in the month following the announcement.

Mr McCann denied a suggestion by counsel for DCC and Mr Flavin that Fyffes was altering its position regarding Fyffes trading performance in the early part of the 2000 financial year.

Mr McCann said the "crucial information" which led to Fyffes issuing a profit warning on March 20th, 2000 was in relation to its trading performance in the early months of the financial year 2000.

He denied that the crucial information related to some 17 factors occurring after January 26th, 2000 and in the period up to March 20th, information which was not available to Mr Flavin.

He said the entirety of the information that Mr Flavin had on February 3rd "when he dealt" was the reason that Fyffes ultimately issued the profit warning.

The cross-examination of Mr McCann continued yesterday, on the ninth day of the action by Fyffes against DCC plc; S and L Investments, of DCC House, Stillorgan, Co Dublin; Mr Flavin, of Shankill, Co Dublin; and Lotus Green Ltd, of Fitzwilton House, Wilton Place, Dublin, a Dutch subsidiary of DCC which owned 10 per cent of Fyffes.

Fyffes claims that DCC and Mr Flavin organised the sale of Fyffes shares on three dates in February 2000 for €106 million, yielding a profit of €85 million, and that these sales breached "insider dealing" provisions of the Companies Act 1990.

The defendants deny the claims, and plead that Lotus Green dealt in the shares and that Mr Flavin had no involvement other than passing on to Lotus Green unsolicited bids for the shares. They also say that Lotus Green had no price-sensitive information and was entitled to deal.

Yesterday, Mr Kevin Feeney SC, for the defence, read out a list of Stock Exchange and other rules obliging companies to disclose to the market any information which might lead to movements in its share price.

Mr McCann said that he was aware in principle of the obligations of companies and their directors and executives in regard to those rules.

He was aware that companies had obligations to exercise judgment as to whether they changed information available to the market.

Mr Feeney said it was required that a company must notify the Companies Announcement Office without delay of any major development in its activities likely to substantially affect its share price.

Mr McCann said he understood that meant companies had to exercise their judgment, and it depended on the nature of the issue whether it would be brought to the company board.